Aftermarket

Navistar Could Close Plants as Part of Cost-Cutting

In his first interview since becoming CEO of Navistar International in late August, Lewis Campbell told Reuters last week that the company may close factories as it works to lower its costs.

The company, which has lost $241 million through the first nine months of this fiscal year, is cutting its white-collar work force by about 800 people through a combination of voluntary buyouts and layoffs and reducing its engineering spending by 28%. It's also reviewing whether it needs all 19 of its North American factories and whether to close or sell any of its businesses outside of its core North American truck and engine operations.

"We are now looking at what are the range of industry volumes that could come to us over time and what is the right footprint? More than likely we'll have to adjust our footprint. And we're ready to do that," Campbell told the news service.

The company does not want to sell its military vehicle operation, Campbell said.

The company already is shuttering its Workhorse operations, a step-van business it acquired seven years ago.

Navistar will sign a contract with engine-maker Cummins by the end of October securing a supply of engines that meet EPA 2010 emissions standards. International had problems meeting those limits using in-cylinder technology only in its MaxxForce engines, so it is turning to Cummins to provide selective catalytic reduction aftertreatment for the 13-liter MaxxForce and dropping the 15-liter version in favor of the Cummins ISX 15.